Samsung fined for posting fake HTC reviews

Samsung has been fined NT$10m (£212,000) by Taiwan’s Fair Trade Commission for paying individuals to post fake negative reviews about HTC devices around the web.

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The commission began investigating the smear campaign, a practice known as “astroturfing”, in April after the TaiwanSamsungLeaks.org website posted what it claimed to be internal documents outlining the scam.

At the time Samsung posted on its Facebook page to apologise for “any inconvenience and confusion” and that “Samsung Taiwan has halted all marketing such as posting articles on website [sic]”.

The FTC’s ruling found the practice violated Taiwan’s Fair Trade Law. The fine levied was less than half of the maximum NT$25m it could have imposed.

In a statement Samsung says: “We are disappointed that the Taiwan FTC has decided that we have violated the Fair Trade Act based on online marketing activities. However, we remain committed to engaging in transparent and honest communication with consumers.

“Samsung Electronics Taiwan is carefully reviewing the decision and will take all necessary steps to protect our reputation as a company which values its customers. Samsung Electronics Taiwan will continue to provide exceptional value for consumers in Taiwan through a wide variety of innovative products and services.”

The ruling came on the same day Samsung posted another record quarter, with net profit increasing 26 per cent to 8.24 trillion won (£4.7bn) on revenue of 59.08 trillion won (£34.3bn).

Samsung’s range of Galaxy smartphones remained its key growth driver, with sales expected to rise in the build up to Christmas.

The company said improvements to its margins were driven by new product launches, helping boost smartphone shipments by 10 per cent on the previous quarter, and “effective marketing cost management”.

In the April to June quarter heavy marketing costs for the launch of the Galaxy S4 smartphone led to it posting weaker than expected profits. 

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